Question

Question 5 (1 point) ✓ Saved Back in the late 19th century, the Carnegie Steel company controlled not only the mills where the steel was manufactured, but also the mines where the iron ore was extracted, the coal mines that supplied the coal, the ships that transported the iron ore and the railroads that transported the coal to the factory. Through several ______ mergers the steel company gained control of the various resources it needed to product steel. O 1) acquired 2) combination 3) horizontal 4) functional 5) vertical

Answer 1

Carneige Steel acquired companies that were in related business or in other words were covering various points of value chain related to same final product i.e. Steel.

This was a classic example of Vertical mergers.Under this type the aim to take control of the various aspects of production and or distribution .Carneige adopted this very strategy when it acquired - Mines that provided the Input , Caol fieldsd that were the source of Fuel and Rail and Shipping companies that were the logictic supports.In this was it controlled the total value chain for Steel manufacturing.

Horizontal Mergers happen between organizations in same industry say Banks,IT companies etc.